Tim Lawrenson
Europe’s defence landscape is shifting as the EU expands its financial tools and industrial ambitions. While NATO remains the continent’s core security guarantor, rising national spending and stricter EU-participation rules are reshaping access, influence and opportunities for partners in Europe’s evolving defence market.
NATO remains Europe’s primary security provider, and its regional plans and capability targets have set strenuous objectives for its European members. However, its role in the continent’s defence market is limited. The European Union, by contrast, has become an increasingly significant actor, particularly since it set up instruments offering financial support to EU industry and member states for capability development and procurement programmes. Having had no dedicated defence budget before 2014, the EU allocated EUR591 million in the 2014–20 Multi-Annual Financial Framework (MFF) rising to EUR11.37 billion for 2021–27. In 2025 the European Commission proposed a EUR131bn budget for defence and space for the 2028–34 MFF.
Having initially focused on supporting defence research and development, the Commission recently expanded its purview to encompass procurement and industrial capacity with a series of instruments, the most significant of which is the EUR150bn Security Action for Europe (SAFE), adopted by EU member states in May 2025. The growing budget, broader mandate and proliferation of instruments will give the EU greater influence over the evolution of the defence market in Europe.
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